What is no-fault auto insurance?Many states have adopted a no-fault system for auto accidents instead of the traditional tort
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No-fault insurance began in the 70's as plan to fight excessive litigation as a result of auto accidents. The idea was that everyone's own insurance company would take care of their medical costs resulting from an accident, regardless of fault. Victims would be prevented from suing at-fault drivers for additional "pain and suffering," though provisions were made for extenuating circumstances.
"Fault" Varies from State to State
No-fault measures vary from state to state. Some have descriptive verbiage to describe what constitutes grounds for legal action, usually to the effect of "life-changing" or "permanently disabling" injuries, though courts have interpreted labels like these to be much broader than they sound. Others set a monetary cap for medial expenses that, once exceeded, constitute damages sufficient to warrant a lawsuit. In practice, this has caused prospective litigants to over-seek medical attention merely to drive up total cost over the threshold.
Is Yours a No-Fault State?
In Kentucky, New Jersey and Pennsylvania, drivers are allowed to choose which system they'd like to participate in. If you live in once of these states, be sure to speak to an insurance agent to see which system is right for you. Agents may refer to the coverage as Personal Injury Protection, or PIP.
Compulsory No-Fault Auto Insurance States:
| Washington D.C. | Florida |
| Hawaii | Kansas |
| Massachusetts | Michigan |
| Minnesota | New York |
| North Dakota | Utah |
Still not sure? Talk to an agent.
If you don't live in one of these states, this obviously isn't a pressing issue, but if you do, be sure you understand the difference from other systems. Agents are experts on this topic; they can walk you through everything you need to know and answer any questions you have.
